Late market roundup: FTSE 100 sets new record but closes in red

Stocks closed lower on Friday in London, although the FTSE 100 rose for the week overall, with NatWest again beating earnings expectations and following a busy week of interest rate calls.

The FTSE 100 index closed down 29.22 points, 0.3%, at 10,868.05. The blue-chip index had earlier hit a new intra-day high of 10,989.45.

The FTSE 250 ended down 104.12 points, 0.4%, at 23,975.02, while the AIM All-Share closed down 2.35 points, 0.3%, at 762.55.

For the week, the FTSE 100 was up 1.2%, the FTSE 250 was up 0.7% and the AIM All-Share was down 1.2%.

The Cboe UK 100 was down slightly at 1,082.05, the Cboe UK 250 was 0.5% higher at 20,958.45, and the Cboe Small Companies was down slightly at 18,682.32.

Trading got off to a bright start in London on Friday with the blue chip index threatening to surpass the 11,000 milestone, but gains evaporated as the day wore on.

NatWest led the risers, up 3.2%, as it raised guidance for 2026 and said it will consider a new share buyback at its annual results, six months earlier than planned, after profit and income beat expectations in the second quarter.

AJ Bell investment director Russ Mould noted this was the fifth time NatWest has beaten consensus forecasts since the government sold its remaining stake last May.

"The company's ability to consistently outmatch expectations has undoubtedly been helped by an environment in which interest rates have stayed higher for longer, but the business has also benefited from its own strategic initiatives," he added.

But IG Group plummeted 14%, the worst FTSE 100 performer, as investors weighed its USD1.3 billion acquisition of US fantasy sports and prediction markets operator Underdog.

The deal came as the London-based online trading platform said late on Thursday that total revenue for the first six months of 2026 increased 18% to £642.8 million from £545.2 million a year prior. But pretax profit fell 6.8% to £227.7 million from £244.3 million.

Elsewhere, J Sainsbury rose 1.0% as it said it had agreed to sell its Argos business for £120 million, significantly less than it had paid for the company, in order "to fully focus on its core food business".

The London-based grocer is divesting the brand, which includes its homeware offering, to Swift Partners.

In a research note, JPMorgan analyst Borja Olcese noted Argos has long been an overhang for Sainsbury, and has typically been a driver of the discount between its and peer Tesco's valuations.

Away from corporate news, investor eyes were on rising bond yields as two Federal Reserve policymakers who dissented from the central bank's decision to keep interest rates steady earlier this week said that rate hikes were needed now in order to avoid entrenched inflation.

The yield on the US 10-year Treasury stretched to 4.74% on Friday from 4.67% on Thursday. The yield on the US 30-year Treasury widened to 5.27% from 5.21%.

In London, the yield on 10-year gilts jumped to 5.05% from 4.99% at the same time on Thursday.

The Fed held rates at 3.50-3.75% for its fifth straight meeting on Wednesday, with three of the committee's 12 members dissenting in favour of a quarter-percentage-point rate hike.

"Inflation has been too high for too long," said one of the dissenters, Beth Hammack, president of the regional Cleveland Fed, in a statement. "The longer that high inflation persists, the more challenging and costly it can be to bring it back down."

Neel Kashkari, the president of the Minneapolis Fed, who dissented alongside Hammack, said in a statement that he thought it was necessary to "tighten policy incrementally as we gather more data on the path of inflation and employment."

"If inflation remains elevated, in my view, a potential series of small policy moves would be better than waiting and eventually concluding that even bolder actions were necessary," he said.

The pound traded at USD1.3463 on Friday afternoon, up from USD1.3439 at the equities close on Thursday. Against the euro, sterling rose to EUR1.1702 from EUR1.1671.

John Healey said he will deliver his first budget as chancellor on October 28, pledging to move "money and power out of Westminster".

He said the budget would "meet our fiscal rules" and "give businesses and families some of the stability they need to plan for the future".

The euro stood lower at USD1.1503 against USD1.1516. Against the yen, the dollar was lower at JPY159.31, compared to JPY159.44.

In European equities on Friday, the CAC 40 in Paris closed up 0.3%, while the DAX 40 in Frankfurt ended up 0.1%.

Stocks in New York were mixed. The Dow Jones Industrial Average was up 0.2%, while the S&P 500 index and the Nasdaq Composite were flat.

It was another day of diverging fortunes for two of Wall Street's leading names. Apple was on the back foot after warning that supply constraints and forex headwinds will temper revenue growth in the September quarter, but Amazon surged after strong results.

Apple, which makes the iPhone and iPad, was 9.3% lower after the warning, which came after results which beat expectations. The earnings were the last to be overseen by Chief Executive Tim Cook, who is stepping down in September after 15 years at the helm.

Amazon, meanwhile, soared 13% as it reported "booming" sales at its cloud business, Amazon Web Services.

"AWS is booming, growing 36.7% year-over-year in Q2 - our fastest growth in 18 quarters - and our AI and Chips businesses each eclipsed run rates of more than USD25 billion," said Andy Jassy, chief executive.

"Amazon's Q2 print was exactly what bulls wanted," remarked analysts at RBC Capital Markets.

Back in London, Greggs was the worst FTSE 250 performer, falling 7.5%.

RBC cut the baker to 'sector perform' from 'outperform'. It snaps a five-day winning streak for the stock, which included an 18% surge on Wednesday.

Housebuilder Taylor Wimpey fell 4.5%, as it slashed its dividend and lowered its shareholder return policy.

The High Wycombe, England-based housebuilder now expects annual returns to amount to 4% of net assets, cut from the previous level of around 7.5%. The new target will comprise a minimum of 2% as an ordinary dividend, together with a further 2% returned either via dividends or share buybacks.

Reflecting the revised policy, Taylor Wimpey on Friday declared an interim dividend of 1.20 pence per share, 74% lower than last year's 4.67p payout, and authorised a further £42 million share buyback to start immediately.

The change "strikes the right balance between continuing to provide an attractive level of shareholder return whilst giving the group greater flexibility and resilience through the cycle," the company said.

Brent oil for September delivery traded higher at USD90.12 a barrel on Friday afternoon, from USD89.84 late Thursday.

Gold was lower at USD4,041.68 an ounce on Friday from USD4,099.23 on Thursday.

The biggest risers on the FTSE 100 were NatWest, up 22.00p at 705.80p, Polar Capital Technology Trust, up 15.00p at 626.50p, Pershing Square Holding, up 88.00p at 3,808.00p, Metlen Energy, up 1.00p at 46.22p and BAE Systems, up 44.00p at 2,094.00p.

The biggest fallers on the FTSE 100 were IG Group, down 246.00p at 1,460.00p, Melrose Industries, down 20.90p at 454.30p, JD Sports, down 3.86p at 89.46p, Experian, down 108.00p at 2,790.00p and Informa, down 28.00p at 885.80p.

Monday's economic calendar has a slew of manufacturing PMIs releases.

Next week's UK corporate calendar has results from Asia-focused bank HSBC, oil major BP and Guinness owner Diageo.

Copyright 2026 Alliance News Ltd. All Rights Reserved.